Depending on whom you ask, the way that took place in the U.S. from 1861 to 1865 might be called the Civil War or "The War of Northern Aggression." Similarly, some say it was fought over slavery while others say it was about states' rights.
Though it's been 150 years since the Civil War ended, questions about when a given topic should be decided at the state or federal level persist to this day. While it's not uncommon for federal law to trump state law, it's also not uncommon for state regulators and legislatures to wind up forcing the federal government's hand.
Just last week, the New York State Department of Financial Services announced it was creating new rules to address cyber issues such as multi-factor authentication, third-party management, encryption and breach notification. "It is our hope that this letter will help spark additional dialogue, collaboration and, ultimately, regulatory convergence among our agencies on new, strong cybersecurity standards for financial institutions," the regulator wrote.
At the same time, the Federal Financial Institutions Examination Council is developing a cybersecurity assessment tool for third-party service providers similar to one it created for FIs.
Meanwhile credit unions continue to push for Congress to address cybersecurity in a more comprehensive manner.
If other states follow New York's lead, credit unions could wind up with a patchwork quilt of rules to navigate—or they will manage to push the federal government to act. The question for federal regulators and lawmakers is whether they will wait for the states or try to get out in front of this.
This same state-national tug of war also is happening regarding the dual membership policy that requires CUs to belong to both CUNA and their respective state leagues.
So far, leagues in Michigan, New York and Ohio have all come out in favor of allowing CUs to choose whether they wish to belong to both or just one, while the association representing Arizona, Colorado and Wyoming has stood firm with CUNA on the dual membership requirement.
As more leagues wrestle with this issue and finally take a side, that may well force CUNA's hand. So, CUNA is faced with the same question that so often faces the federal government. Will it wait for the states to act, or get out in front of this issue?
Editor in Chief Lisa Freeman can be reached at
